(NEW YORK) — The Dow Jones Industrial Average rebounded sharply Tuesday, though not nearly enough to make up for the massive coronavirus-induced losses suffered Monday.
The Dow climbed more than 1,000 points or over 5% by the time market’s closed.
The index saw more than 500-point swings in a volatile trading day Tuesday that came after it suffered its worst day since the “Black Monday” crash of 1987 on Monday, plunging nearly 3,000 points or 12.94%.
The S&P 500 and Nasdaq also climbed Tuesday, with both indices up by 5.99% and 6.23%, respectively, at closing. Both shed approximately 12% during Monday’s bloodletting on Wall Street.
A midday rally came after the Federal Reserve announced further intervention amid the coronavirus crisis, establishing a commercial paper fund to help support the flow of credit to U.S. households and businesses.
Hopes of a further stimulus package from the Trump administration, that included money going directly into the Americans’ pockets, also seemed to quell investors’ anxieties about the economy after the steep sell-off Monday.
“At my direction, [Treasury] Secretary Mnuchin is meeting today with senators on additional stimulus packages,” President Donald Trump said at a press briefing Tuesday, adding that the administration is looking at a range of relief from help for the airline industry to loans for small businesses to financial flexibility for fast food workers.
In the most dramatic move to help average American workers, Treasury Secretary Steven Mnuchin also announced that the administration is looking at sending checks directly to households that are hurting — possibly within the next two weeks, supporting an idea that began in Congress.
“We are looking at sending checks to Americans immediately. What we heard from hardworking Americans, many companies are now shut down whether bars or restaurants, Americans need cash now and the president wants to get them cash now. I mean now in the next two weeks,” Mncuhin said. “We want to make sure Americans get money in their pockets quickly,” he said, adding that more details would be revealed later today.
Earlier Tuesday, economists at S&P Global announced that they forecast a global recession will likely hit by the end of the year as a result of the COVID-19 pandemic.
“The initial data from China suggests that its economy was hit far harder than projected, though a tentative stabilization has begun,” S&P Global’s chief economist Paul Gruenwald said in a statement.
“Europe and the U.S. are following a similar path, as increasing restrictions on person-to-person contacts presage a demand collapse that will take activity sharply lower in the second quarter before a recovery begins later in the year,” Gruenwald added.
Premarket trading on equities saw heavy volatility Monday night and into Tuesday morning, especially after President Donald Trump tweeted that the U.S. will be “powerfully supporting” industries impacted by the economic fallout of the coronavirus outbreak.
Since the COVID-19 outbreak, the Dow has seesawed by more than 1,000 points and entered a bear market for the first time in 11 years. The S&P 500 and Nasdaq are also in bear market territory.
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